EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0904050
Customs Act 1901
Background
Part XVA of the Customs Act 1901 (the Act) sets out a scheme under which Tariff Concession Orders (TCOs) may be made by the Chief Executive Officer of Customs (the CEO). A lower rate of customs duty applies to goods that are the subject of a TCO.
Under section 269F of the Act, a person may apply to the CEO for a TCO in respect of goods. If the CEO is satisfied that the application is not in respect of goods specified in section 269SJ of the Act, which sets out those goods that cannot be subject to a TCO, the CEO must decide whether the application meets the core criteria.
Section 269C of the Act provides that a TCO application meets the core criteria if, on the day on which the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. Section 269B of the Act provides that ‘goods produced in Australia’ has the meaning given by section 269D, ‘ordinary course of business’ has the meaning given by section 269E and ‘substitutable goods’ in respect of goods the subject of a TCO application, means goods produced in Australia that are put, or are capable of being put, to a use that corresponds with a use (including a design use) to which the goods the subject of the application can be put.
Subsection 269P(3) of the Act provides that if the CEO is satisfied that a TCO application meets the core criteria, the CEO must make a written order (a TCO) declaring that the goods the subject of the TCO application are goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 (the Tariff) specified in the order applies.
Lynas Corporation Ltd applied for a TCO in respect of certain filter presses on 06 February 2009.
Instrument
TCO No 0904050 was made on 01 May 2009. It declares that those certain filter presses are goods to which item 50 of Schedule 4 to the Tariff applies since the CEO was satisfied that no substitutable goods were produced in Australia. The general rate of duty on these goods is 5%. The rate of duty for the goods subject to the TCO is free.
Consultation
Subsection 269K(1) of the Act provides in part that as soon as practicable after accepting a TCO application as a valid application, the CEO must publish a notice in the Gazette which includes an invitation to any person who considers that there are reasons why the TCO should not be made to lodge a submission with the CEO. The CEO did not receive any submissions in response to this invitation.
Commencement
Subsection 269S(1) relevantly provides that a TCO is to be taken to have come into force on the day on which the application for the TCO was lodged. TCO No. 0904050 is taken to have come into force on 06 February 2009.
The TCO does not affect the rights of a person (other than the Commonwealth) as at the date of registration so as to disadvantage that person or impose liabilities on a person (other than the Commonwealth) in respect of anything done or omitted to be done before the date of registration. The rights of importers will be beneficially affected. Under paragraph 126(1)(r) of the Regulations, importers of such goods will be able to apply for a refund of duty on goods imported since the day on which the TCO is taken to have come into force. The TCO does not impose any liabilities on any person.
Overview
The Customs Act 1901 was amended with the introduction of the Customs Amendment (Tariff Concession) Instrument 2009, which was enacted to address the need for tariff concessions on specific imported goods to foster economic development and competitiveness. This legislative instrument was introduced by the Commonwealth Government and seeks to provide relief from customs duties for goods that are not produced domestically, thereby encouraging imports and benefiting the economy. The Tariff Concession Order No. 0904050, for example, was made to facilitate the importation of certain filter presses by Lynas Corporation Ltd, as no substitutable goods were produced in Australia, allowing for a reduction in the customs duty from the general rate of 5% to a concessional rate of free. The instrument ensures that no pre-existing rights of non-Commonwealth entities are adversely affected, while also providing a mechanism for importers to seek duty refunds on goods imported since the concession took effect.
Scope and Application
The Customs Act 1901, specifically Part XVA, outlines the framework for the creation of Tariff Concession Orders (TCOs) by the Chief Executive Officer of Customs (CEO). This legislation applies to any person who may apply for a TCO in respect of goods, as per section 269F of the Act. The Act provides for a lower rate of customs duty on goods that are the subject of a TCO, provided that certain criteria are met. Notably, the application must not pertain to goods specified in section 269SJ of the Act, which lists those goods that cannot be subject to a TCO. The Act further stipulates that a TCO application meets the core criteria if, on the date of application, no substitutable goods are produced in Australia in the ordinary course of business, as defined in sections 269C and 269D. The instrument extends to any goods specified in the TCO, with the geographic reach being national as it pertains to Australian customs duty and import regulations. There are no stated exclusions, exemptions, or thresholds within the text, and the application of the Act is not extended or restricted by subordinate instruments as per the provided explanatory statement.
Key Provisions
The Tariff Concession Instrument No. 0904050 under the Customs Act 1901 (the Act) (sections 269C, 269F, 269P(3)) provides for the application and establishment of a Tariff Concession Order (TCO) in respect of certain goods, specifically certain filter presses in this instance. This legislative instrument allows for a reduction or elimination of customs duty on specified goods, in this case bringing the duty rate down to free from the general rate of 5%. This is effective from the date the application for the TCO was lodged, which in this case was 06 February 2009 (section 269S(1)).
The Act imposes certain obligations on parties applying for a TCO. A person can apply to the Chief Executive Officer of Customs (CEO) for a TCO (section 269F). The CEO must then decide if the application meets the core criteria, which include ensuring that no substitutable goods were produced in Australia in the ordinary course of business on the day the application was lodged (sections 269C, 269D, 269E). If the CEO is satisfied that the application meets these criteria, a written order, the TCO, must be made (section 269P(3)). Additionally, as soon as practicable after accepting a TCO application as valid, the CEO must publish a notice in the Gazette inviting any person who considers that there are reasons why the TCO should not be made to lodge a submission (subsection 269K(1)). In this instance, no submissions were received in response to this invitation.
There are no specific offences, penalties, or civil or criminal consequences mentioned in the explanatory statement for breach of the provisions of this TCO. However, it is worth noting that the TCO does not affect the rights of any person (other than the Commonwealth) in a way that would disadvantage them or impose liabilities for actions taken before the date of registration (subsection 269S(1)). Importers will benefit from this TCO by being able to apply for a refund of duty on goods imported since the day the TCO is taken to have come into force (paragraph 126(1)(r) of the Regulations).